The U.S. Securities and Exchange Commission has authorized the listing and trading of options for BlackRock’s spot Bitcoin exchange-traded fund on Nasdaq. The options for the iShares Bitcoin Trust, which will use the ticker symbol “IBIT,” were approved by the regulator in a notice released on Friday.
These index options are derivatives that provide a cost-effective method for investors to increase their exposure to Bitcoin, offering institutional investors and traders an alternative way to hedge against fluctuations in the value of the largest cryptocurrency.
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This approval for options linked to a Bitcoin ETF marks another significant milestone for cryptocurrency, which has gradually gained acceptance as a mainstream asset class since the launch of Bitcoin ETFs earlier this year.
Options grant holders the right to buy or sell an asset, such as stocks or ETFs, at a predetermined price before a specified date. Following indications that the SEC would approve the underlying ETFs in January, exchanges quickly began applying for the spot Bitcoin ETF options.
The SEC is responsible for overseeing the necessary technical rule changes that exchanges must implement to list these options and confirmed that its current surveillance protocols will apply to IBIT options.
